Shrinking surplus a challenge

As appropriations chairman, C.W. Bill Young warns that painful choices are ahead.

WASHINGTON -- "I have a question and I don't want a bull---- answer," Rep. Nancy Johnson said to Rep. C.W. Bill Young at a private meeting of House Republicans last week. "How are we going to do all these great things and not cut into Social Security?"

Young told the Connecticut congresswoman that he wanted to protect Social Security, but he warned his colleagues that they face painful choices in the next few weeks.

"It's interesting, Nancy, that I have requests from members (that exceed) the budget by about $75-billion," Young recalls saying.

Their candid exchange illustrates the challenge facing Young, the Largo Republican who leads the House Appropriations Committee. With new estimates showing a dwindling budget surplus, Young is trying to craft a compromise that does not cut existing government programs or threaten the pet projects of individual lawmakers.

Republican and Democratic leaders have said they do not want to spend the Social Security surplus, the money from payroll taxes left over after current benefits are paid. For years, Congress routinely dipped into that surplus. But in the past few years, both parties have pledged not to use it for general expenses.

But Congress is facing bigger bills for the coming year.

Young and many other members want to spend more for defense -- including the missile defense system and repairs to dilapidated military bases -- and more for schools. President Bush's education plan has a price tag of $2-billion to $6.5-billion, under the different versions passed by the House and Senate.

Sen. Bill Nelson, D-Florida, sums up Young's predicament like this: "C.W. Bill's in a heck of a fix. You can't get 15 pounds of potatoes out of a 10-pound sack."

To make Young's job even more difficult, the Republican majority in the House has shrunk to 219-210 because of the resignations of Reps. Joe Scarborough of Pensacola and Asa Hutchinson of Arkansas and the death of Rep. Floyd Spence of South Carolina. With such a slim margin, Young likely will need Democratic votes.

As appropriations chairman, Young is in charge of the 13 bills that provide money to government agencies. He must shepherd the bills from his committee to the House floor, making sure he has the votes needed for passage. (He notes proudly that the nine bills that have passed so far this year have each had at least 334 votes.)

For each bill, Young and other House members will take part in a conference committee to reconcile differences with the Senate. At every turn, there is a need for compromise.

This year, producing a balanced budget is especially difficult because of the slowdown in the economy.

New budget estimates say the slowdown has reduced tax payments, which means Congress would have to dip into the Social Security surplus to pay for the current $661-billion budget and the increases for defense and education.

The budget estimates have prompted lots of bickering.

Democrats, who had warned earlier this year that President Bush's tax cut would squander the surplus, last week crowed I-told-you-so. Republicans snapped back that Congress would be in the same situation if the Democratic tax cut plan had passed.

But Young says he won't play those partisan games. He jokingly refers to the rhetoric on both sides with the same bull terminology that Johnson used. He says he just needs to cut a deal with Democrats and the White House.

Young says he already has a tentative agreement with Rep. David Obey of Wisconsin, the ranking Democrat on his committee, to spend an additional $3.3-billion for education. Young met last week with Sen. Robert Byrd of West Virginia, the Democrat who heads the Senate Appropriations Committee, and says he and Byrd have a good relationship.

But depending on which budget estimate they use, there could be a shortfall of more than $6-billion. Where can Congress find that money?

A few members, including Sen. Pete Domenici of New Mexico, the ranking Republican on the Budget Committee, are willing to dip into the Social Security surplus. They say that Congress did that for years and that it does not affect the program's current benefits or its future.

But Young, who points out that his district includes one of the highest concentrations of senior citizens in the nation, is emphatic that he won't touch the Social Security surplus: "We made a commitment, and I intend to keep our commitment."

Young also says he does not want to delay the tax cuts because he thinks they are necessary to stimulate the economy.

Among his other options:

An across-the-board cut of all government programs. Congress used that technique two years ago, but Young says he doesn't like the approach because it can be unfair.

Cutting political pork. Although lobbyists are concerned, Congress is usually reluctant to cut pet projects.

A smaller defense increase. Young has always been one of the Pentagon's biggest supporters, so he does not want to reduce the money. But he said last week that it might be necessary.

Accounting tricks. Congress has often used creative bookkeeping to balance the budget. Expenses from one year have been charged against the previous year's budget, or routine costs have been charged as emergencies. But Young says he won't do that this year.

Finding surplus money in programs that Young's committee does not oversee. These "non-discretionary" programs spend billions for things such as highways and airports. Young said his committee is exploring whether there is any leftover money in those programs that could be used to make up the shortfall.

Passing the spending bills now, but delaying action on the defense and education increases until the economy improves.

"The economy may have bottomed out," Young says with a hopeful tone. "If that has happened, we won't have the problems we're talking about."

- Times staff writer Bill Adair can be reached at (202) 463-0575 or adair@sptimes.com.